Canadian construction and engineering firm SNC-Lavalin on Thursday reported a lower-than-expected profit as expenses soared mainly due to its acquisition of WS Atkins.
Montreal-based SNC closed the C$3.6 billion acquisition of British engineer WS Atkins in July. The deal helped SNC-Lavalin boost its nuclear, rail, transportation and infrastructure businesses, while cutting exposure to the oil and gas industry.
WS Atkins, now the engineering, design, project management (EDPM) segment of SNC-Lavalin, contributed C$700 million ($545 million) to the company’s first-quarter engineering and construction revenue, which rose 32.4 percent to C$2.37 billion.
Expenses jumped to C$42 million from C$13 million.
The company’s net income attributable to shareholders fell to C$78.1 million, or 44 Canadian cents per share, in the quarter ended March 31, from C$89.7 million, or 60 Canadian cent per share, a year earlier.
Excluding items, the company earned 51 Canadian cents per share, below the average analyst estimate of 55 Canadian cents, according to Thomson Reuters I/B/E/S.
Revenue rose 31.5 percent to C$2.43 billion